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Understanding “substantial gainful activity”

One of the principal criteria for determining eligibility for Social Security disability benefits is whether the applicant is unable to work, or, in the language of the applicable statutes and regulations, unable to engage in “substantial gainful activity,” or SGA. The general rule is very straightforward: a person who is able to engage in SGA is deemed able to work and not eligible for disability benefits; a person who is unable to engage in SGA is deemed to be totally disabled and eligible for benefits. However, the calculation and application of the SGA standard can be quite complex.

SGA is defined by the Social Security Administration as a specified gross amount of monthly income. A person who earns more than this figure is engaging in SGA and is not entitled to disability benefits. A person who earns less than the SGA amount is deemed to be disabled and therefore eligible for SSD benefits. The SGA amount may vary from year to year depending upon economic conditions in the country as a whole. The SGA amount for blind persons in 2016 is 1,860 per month and $1,130 for non-blind persons.

The calculation of a person’s SGA amount begins but does not end with the person’s monthly salary or wage. SSA makes a determination of whether a person’s wage represents the person’s true earning ability. If, for example, an employer pays a disabled employer more than his worth (perhaps because the employer is aware of the employee’s disability and wishes to provide assistance), the amount of extra pay is treated as a subsidy and subtracted from the employee’s monthly wage. If the employee incurs medically necessary expenses, such as cab fares, to travel to and from work, these expenses can be deducted from the monthly wage to calculate the individual’s SGA amount. So long as the person’s net earnings amount is less than the specified SGA rate, the person is eligible for SSDI benefits.

Many other factors can affect a person’s SGA amount and his or her eligibility for benefits. Anyone with questions or who has received an adverse determination of an application for benefits may wish to consult a lawyer who specializes in SSDI benefit claims for an evaluation of the medical evidence, the SSA’s initial determination and a recommendation on the advisability of taking an appeal.

Source: Social Security Administration, “2016 Red Book,” accessed on April 3, 2016

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